Bangkok has been shaken by more than a month of mass opposition rallies aimed at ousting Yingluck and ridding the kingdom of the influence of her older brother, deposed former leader Thaksin.

An estimated 7,000 protesters gathered in the city on Tuesday afternoon calling for the elected government to step down, a sharp drop from the roughly 140,000 people who attended on Monday.

The demonstrators are a loosely-allied group united by their animosity towards Thaksin, a billionaire tycoon-turned-politician who was overthrown in a military coup seven years ago but is widely thought to control the government from abroad.

Yingluck, who called an early election on Monday in an effort to calm the political turmoil, said her cabinet was legally-bound to act as an interim government until the polls are held.

"I would like the protesters to stop and to use the electoral system to choose who will become the next government," she told reporters after a cabinet meeting early Tuesday.

A visibly emotional Yingluck - who said she had not discussed with party colleagues whether she would run in the February 2 election - reacted angrily to protesters' calls that her family be removed from Thailand.

"I have retreated as far as I can - give me some fairness," she said.

Rally leader Suthep Thaugsuban has rejected elections and vowed to set up a parallel government that would suspend the democratic system in Thailand and redraw its constitution.

The firebrand former deputy prime minister, who faces an arrest warrant for insurrection over the protests, issued an ultimatum late Monday calling on Yingluck and her colleagues to resign from the caretaker government.

Huge crowds converged on the government headquarters on Monday in one of the largest turnouts since the protests began, bringing with them a caravan of food stalls and vendors of a wide variety of protest paraphernalia - from t-shirts to tiaras.